Glossary

A

abstract - An abbreviation of the cardinal aspects of all recorded deeds, mortgages, leases and other instruments affecting the title to a particular piece of land.

abut - To touch or border upon. A piece of land bordering on a street or an adjoining piece of property is said to abut such street or property.

acknowledgement - (1) Generally, the act of the maker or makers of a real estate instrument in going before a Notary Public or other judicial officer and acknowledging that they signed such instrument without fear or compulsion, and for the purposes expressed in such instrument. The laws making provision for acknowledgments incident to real estate papers were enacted to help prevent forgeries or undue advantage taken over the makers of such instruments. Forms and procedures incident to acknowledgments vary from state to state, some being considered probate procedures in which the probity or authenticity of the instrument is proven. (2) Generally, a form of certificate made by a notary public or judicial officer, appended to deeds, mortgages, leases and other real estate instruments, certifying that the maker or makers of such instruments appeared before the notary or judicial officer and acknowledged that they signed the instrument without compulsion or fear and for the purposes indicated in the instrument.

administer - To pay the debts and wind up the business of a deceased person's estate. Also, to handle and dispose of properties of an estate by an executor, administrator or trustee in conformity with legal procedures and provisions of wills or trust instruments.

administrator - A person appointed by a probate court to administer the estate of a person who dies intestate; that is without leaving a will.

adverse possession - The unauthorized occupation of land belonging to another, by a person who does not have the consent of the owner. Said occupier is said to hold possession adversely to the rights and interests of the owner. In most states, by operation of law, title to the land becomes vested in such occupier after a fixed number of years of occupancy if certain conditions are met.

affidavit - A written statement made under oath before a notary public or other judicial officer. AGENT – one who is authorized to act for or represent a principal. Title insurance companies issue title policies either directly from an office of the company or through an independent agent.

agreement - A legally binding compact made between two or more persons.

arbitration - the process by which parties who cannot agree among themselves submit the dispute to the judgment of an impartial party.

assessment - (1) The act of fixing the amount of taxes or special improvement charges. (2) The amount of taxes or special improvement charges. Special improvement charges are usually for the costs of streets, sidewalks, sewers, etc. (3) Homeowners’ or property owners’ associations may be authorized to levy assessments on units within a private development for improvements or maintenance of common areas in the development.

assignee - For example, the person who receives ownership of a contract or a mortgage by transfer from another.

assignment - (1) The act of transferring ownership of something from one person to another. (2) The instrument or paper by which one person transfers ownership of a right or an object to another.

assignor - For example, the person who transfers ownership of a contract or mortgage to another.

attorney’s opinion - The written statement of an attorney setting forth what he believes to be the condition of a real estate title.

B

back title letter - Also called "Back Title Certificate" in some areas, and "Starter" in others. Where titles have been previously examined up to a certain date by reliable examiners, title companies sometimes give subsequent examiners of such titles a letter which sets forth the condition of the title at the time of the previous examination and authorizes them to begin their subsequent examination with the terminal date of the previous examination (See Tacking-on).

bargain and sale deed - Sometimes called "fee simple deed." A deed of conveyance which presumes that the grantor holds title, but which makes no warranty with respect to the title.

beneficiary - A person who is entitled to receive funds or property under the terms and provisions of a will or trust or insurance policy.

bill of sale - The instrument by which title to personal property is transferred or conveyed.

C

certificate of title - A certificate issued by a title examiner stating the condition of a title. Usually more formal than an attorney's opinion.

chain of title - Beginning with a conveyance out of an original source of title such as a government, each succeeding deed, will or other medium which conveys and transfers the title to succeeding owners constitutes a link in the chain of title. The chain of title is the composite of all such links.

claim - A right to assert, or the assertion of, a demand for payment of money due; or the surrender or delivery of possession of property or the recognition or some right. A demand for something as one's rightful due.

closing - In some areas called a "settlement". The process of completing a real estate transaction during which deeds, mortgages, leases and other required instruments are signed and/or delivered, an accounting between the parties is made, the money is disbursed, the papers are recorded, and all other details such as payment of outstanding liens and transfer of hazard insurance policies are attended to.

closing statement - A summation, in the form of a balance sheet, made at a closing, showing the amounts of debits and credits to which each party to a real estate transaction is entitled.

cloud on title - An irregularity, possible claim, or encumbrance which, if valid, would adversely affect or impair the title.

condemnation - (1) The taking of private property for public or quasi-public use, with compensation to the owner, under the right of eminent domain. All governments and so-called public service corporations, such as railroads and electric companies, have the right to condemn and take private property. (2) The destruction by government of private property which imperils the life, health or safety of the public.

conditions - This term is first cousin to restrictions and reservations. It refers to provisions in deeds and other real estate instruments which provisions make a particular right contingent upon the occurrence of some future event.

contract - Same as "agreement", but usually more formal.

conveyance - The transfer of title to property from one person to another.

covenant - A formal agreement or contract between two parties in which one party gives the other certain promises and assurances, such as covenants of warranty in a warranty deed.

D

deed - An instrument, of various forms, by which title to real estate is conveyed from one party to another.

deed book - A book among the public records in which deeds are recorded.

deed of trust – An instrument used in many states in place of a mortgage. Property is transferred to a Trustee by the borrower (trustor) in favor of the lender (beneficiary), and released or reconveyed upon payment in full.

defect - A blemish, imperfection or deficiency. A defective title is one that is irregular and faulty.

deposit agreement - Sometimes called "Deposit Receipt." An agreement, used in some areas, prepared by real estate agents and signed by purchaser and seller acknowledging that a sale has been agreed to and that, in order to bind the deal, a certain amount of good faith money has been deposited by the purchaser with the agent or a title company. Such agreements are often as comprehensive, with respect to terms of sale, as regular real estate sales agreements.

depreciation - Loss in value occasioned by ordinary wear and tear; destructive action of the elements; or functional or economic obsolescence.

devise - A gift of real estate (or sometimes any property) made by a will.

devisee - One who is given real estate (or sometimes any property) under a will.

dominant estate - The property for the benefit of which a right-of-way or easement exists across another's adjoining piece of land is said to be the dominant estate. The land across which the easement runs is said to be the servient estate.

draw - A partial advance of the proceeds of a construction loan mortgage, to which the borrower is entitled when construction reaches a certain specified stage.

E

earnest money - The advance, by a purchaser, of a small part of the purchase price as evidence of good faith.

easement - A right held by a person to enjoy or make limited use of another's real property.

egress - The right to a path or right-of-way over which a person may leave or go away from his own real estate.

eminent domain - The right of a government to take privately owned property for public purposes under condemnation proceedings upon payment of its reasonable value.

encroachment - The extension of a structure from the real estate to which it belongs across a boundary line and onto adjoining property.

encumberance - A claim, right, or lien upon the title to real estate, held by someone other than the real estate owner.

equitable rights - Rights established primarily by court decisions based upon principles of fairness, honesty, justness and morality and not upon enacted law or common law.

equity - A system of jurisprudence supplementing the common law and enacted law under which justice, impartiality, and fairness is applied in circumstances not covered by enacted or common law.

escheat- The reversion of unclaimed property to the state, such as when an owner dies leaving no legal heirs, devisees or claimants.

escrow - Technically, this term strictly refers to a deed delivered to a third person to be held by him until the fulfillment or performance of some act or condition by the grantee. In title industry parlance it means the depositing with an impartial third party called the escrow agent of anything pertaining to a real estate transaction including money and documents of all kinds which are to be disbursed and delivered to the rightful parties by the escrow agent when all conditions of the transaction have been met.

escrow agreement - A written agreement usually made between buyer, seller, and escrow agent, but sometimes only between one person and the escrow agent. It sets forth the conditions to be performed incident to the object deposited in escrow, and gives the escrow agent instructions with respect to the disposition of the object so deposited.

estate - (1) A sizable piece of rural land usually with a large house and other pretentious improvements. (2) The whole of one's possessions, especially all of the property, assets, debts, and liabilities left by a deceased or bankrupt person. (3) The nature and extent of an owner's rights in real estate.

estoppel - A legal restraint which stops or prevents a person from contradicting or reneging on his previous position or previous assertions or commitments.

exception - In title industry parlance, a provision in a title insurance binder or policy which excludes liability regarding a specified title defect or an outstanding lien or encumbrance.

executor – the person appointed under a will to administer the estate of a testate decedent.

F

falsification - The forging, altering, or counterfeiting of a document, or knowingly making untruthful statements or misrepresentations.

fee simple - The highest degree of ownership which a person can have in real estate. An interest in real estate which gives the owner unqualified ownership and full power of disposition.

fiduciary - A person who bears a special relationship of trust, confidence, and responsibility to others, such as a trustee or agent.

first mortgage - A mortgage having priority as a lien over any other mortgage or lien on the same property.

fixture - Personal property which is permanently attached to real estate such as plumbing fixtures. So long as a fixture is permanently attached, it is usually regarded as part of the real estate.

foreclosure - A legal proceeding for the collection of real estate mortgages and other types of liens on real estate, which results in cutting off the right to redeem the mortgaged property and usually involves a judicial sale of the property to pay the mortgage debt.

H

hazard - A danger, peril or risk. Incident to title insurance, it relates to the risk assumed under a title insurance policy.

heir - A person who inherits or who is entitled to inherit real estate by provisions of law from an intestate decedent.

homestead - (1) Property designated by the head of a family as his home, which is protected by law from forced sale to pay his debts. (2) Land claimed by a settler under the National Homestead Act. (3) Under some state laws, the real estate upon which one's home is situated.

I

indemnity - Insurance against possible loss or damage. A title insurance policy is a contract of indemnity.

index - (1) An alphabetical listing in the public records of the names of parties to recorded real estate instruments together with the book and page number of the record. (2) The listing in abstract and title plants of recorded real estate instruments in groups according to land descriptions, known as a geographic index. (3) The alphabetical listing in abstract and title plants, by names of the parties, of all recorded instruments which affect but do not describe particular real estate, such as judgments, powers of attorney, wills and probate proceedings. Such indexes are known by various names such as General Index, Judgment Index, and Name Index.

ingress - The right or permission to enter; also the means or place of entry such as a right-of-way across adjoining land.

instrument - Any written document by which something is done regarding rights or interests in real estate.

J

joint tenants - Two or more persons who hold title to real estate jointly, with equal rights to share in its enjoyment. Usually joint tenants hold as tenants in common or as joint tenants with a right of survivorship.

joint tenants with right of survivorship - Two or more persons who hold title to real estate jointly, with equal rights to share in its enjoyment during their respective lives with the provision that upon the death of a joint tenant, his share in the property passes to the surviving tenants, and so on, until the full title is vested in the last survivor. If a joint tenant with a right of survivorship conveys his interest in the property during his lifetime to a third party who is not one of the joint tenants, the right of survivorship is extinguished as to that interest and the grantee takes only as a tenant in common with the other joint tenants who retain a right of survivorship among themselves.

judgment - A conclusion or determination by a court of law usually awarding the payment of money or relief of some kind to one of the parties to a lawsuit. junior mortgage - A mortgage lower in lien priority than a first mortgage.

L

lease - An agreement granting the use or occupancy of land during a specified period in exchange for rent.

leasehold - (1) Property held by lease. (2) The estate or interest in real estate created by a lease.

lessee - A tenant holding a lease.

lessor - One who gives a lease to a lessee, landlord.

liability - A legal obligation or responsibility for the payment of a loss or damages or a debt.

lien - The liability of real estate as security for payment of a debt. Such liability may be created by contract, such as a mortgage, or by operation of law, such as a mechanics lien.

life estate - An estate of ownership in real estate which exists only during the term of a certain person's life.

lis pendens - A pending lawsuit. A lis pendens notice is legal notice to the world that a lawsuit which may affect title to real property is pending.

listing - (1) Placing real estate with a broker for sale or lease. (2) A conditional agreement to pay a commission to the broker if and when he finds a qualified buyer or tenant.

loan policy - (Sometimes called a lenders or mortgagee policy.) A policy of title insurance insuring a mortgagee, or beneficiary under a deed of trust, against loss caused by invalid title in the borrower, or loss of priority of the mortgage or deed of trust.

M

marketable title - A title which a court of equity considers to be so free of material defects and liens that it will force the title's acceptance by a questioning purchaser. Also known as a merchantable title.

market value - An average between the highest price which a buyer, willing but not compelled to buy, would pay and the lowest price a seller, willing, but not compelled to sell, would accept.

mechanic’s lien - A lien on real estate, created by operation of law, which secures the payment of debts due to persons who perform labor or services or furnish materials incident to the construction of buildings and improvements on real estate.

mediation - an informal process conducted by a mediator with the objective of helping parties voluntarily settle their dispute.

metes and bounds - A land description in which boundaries are described by courses, directions, distances, and monuments.

mortgage - (From the Latin Terms "mors" and "mort" meaning death or dead.) A temporary, conditional pledge of property to a creditor as security for the payment of a debt which may be killed or cancelled by payment.

mortgagee - The holder of a mortgage. The party to whom a mortgage is made.

mortgagor - A person who mortgages property. A person who executes a mortgage.

personal representative – the administrator or executor who administers the estate of a decedent.

plat book - One in a set of books in the public records in which maps, plats, and copies of surveys are recorded.

power of attorney - A legal instrument authorizing one to act as another's agent or attorney.

prescription - In the broad sense of modern times, the gaining of some right or interest in real estate through long and continuous adverse use, usually for a period prescribed by statute, such as the acquisition of an easement by the unlicensed and adverse use of a path, roadway, or utility lines across another property.

principal - (1) A sum of money owed as a debt upon which interest is payable. (2) A person who empowers another to act as his representative or agent. (3) The person having prime responsibility for an obligation as distinguished from one who acts as a surety or endorser.

probate - A legal procedure in which the validity and probity of a document, such as a will, is proven.

promissory note - A written promise to pay or repay a specified sum of money at a stated time, or on demand, to a named person. In addition to the payment of principal, a promissory note usually provides for the payment of interest.

public records - Records established under state statutes for the purpose of imparting constructive notice of matters relating to real property to purchasers for value and lien holders.

R

real estate - Land, including all inherent natural attributes and any man-made improvements of a permanent nature placed thereon.

real property - See Real Estate.

REALTOR® - A copyrighted trade name which can be legally used only by those persons belonging to the National Association of Real Estate Boards.

recording - The act of a recorder of receiving and transcribing, in a book or in some other medium of the public records, instruments affecting the title to real estate.

record title - The aspects of a title which appear in the public records as distinguished from unrecorded title aspects and interests.

reinsurance - Insurance insuring an insurer. When an insurance company has issued a policy and does not want to be fully exposed to loss for the full amount of the policy, such company may purchase a reinsurance policy from another insurance company to insure that first company against a part or all of the loss which the first company may have to pay under its policy.

release - (1) To relieve from debt or security or abandon a right, such as the release of a mortgage lien from a part or all of the land mortgaged. (2) The instrument affecting a release.

restrictions - Often called restrictive covenants. Provisions in a deed or other instrument whereby an owner of land prohibits or restricts certain use, occupation, and improvement of the land.

restrictive covenants - (See Restrictions.)

reversion - (1) The return of an estate or interest to a grantor or lessor after the grant or lease has expired. (2) The interest retained by a fee simple owner of real estate after granting a terminable estate or interest in such property to another. For example, when a fee simple owner gives a lease to a tenant, the interest which the owner has left is known as the reversion. (3) A provision accompanying restrictive covenants in a deed, which provision stipulates that in the event the restrictions are violated, title to the property shall revert to the grantor.

right of way - (1) The right to pass over property owned by another, usually based upon an easement. (2) A path or thoroughfare over which passage is made. (3) A strip of land over which facilities such as highways, railroads, or power lines are built.

riparian rights - The many rights of a person in, to, and over the banks, bed, shallows, shore, and water of a stream or body of water upon which his land borders.

risk - Exposure to loss. A title insurance company assumes the risk incident to a possible title loss when it insures the owner of the title.

S

sale agreement - A contract entered into between a buyer and seller, setting forth the terms, provisions, and conditions of a sale of real estate.

sales contract - (See Sale Agreement.)

satisfaction - (1) The payment of a debt or fulfillment of an obligation. (2) An instrument executed by the holder of a lien, debt or obligation which acknowledges payment or fulfillment. For example, a satisfaction of a mortgage sometimes is referred to as a satisfaction instrument.

search – In the title industry, a careful exploration and perusal of the public records in an effort to find all recorded instruments relating to a particular chain of title.

security - Assurance against the default or non-payment of a debt or obligation which makes the enforcement of a promise or an obligation more certain than the personal commitment of the debtor or obligator. Usually the pledge of property.

servitude - A right or interest in a piece of real estate, which right or interest serves or benefits another unrelated property. For example, an easement across one piece of property which serves another piece of property is said to constitute a servitude regarding the property upon which it is located.

settlement - (See Closing.)

special warranty deed - A deed which warrants the title only with respect to acts of the grantor and the interests of anyone claiming by, through, or under him.

statute of limitations - A statute setting a time limit on the enforcement of a right.

subdivision - An area of land laid out and divided into lots, blocks, and building sites, and in which public facilities are laid out, such as streets, alleys, parks, and easements for public utilities.

subordination - Giving a lien or interest an inferior status. For example, an existing mortgage may be subordinated to the lien of a new construction loan mortgage in which case the construction loan mortgage becomes a prior lien.

subrogation - The legal doctrine under which the law substitutes one creditor or claimant for another. When a title insurance company pays a claim under a title insurance policy, it is entitled to step into the shoes of the insured with respect to any rights the insured may have against parties who warranted the title to him.

survey - (1) To determine the location, boundaries, area, or the elevations of land and structures upon the earth's surface by means of courses in relation to a defined reference point, commonly the North Star, and the measuring of angles and distances by using the techniques of geometry and trigonometry. (2) The map or plat drawn by a surveyor which represents the property surveyed and shows the results of a survey.

T

tax lien - The lien which is imposed upon real estate by operation of law which secures the payment of real estate taxes.

tenant - (1) Usually one who holds possession of real estate under a lease. (2) In a broader sense, one who holds or possesses lands and tenements by any kind of title.

tenants in common - Two or more persons in whom title to a single piece of real estate is vested in such a manner that they have a common or equal right to possession and enjoyment of the property, but each holds a separate individual interest or estate in the property. Each owner may sell or encumber his respective interest or dispose of it by will, and if he dies without leaving a will, his heirs inherit his undivided interest. One tenant in common’s conveyance purporting to affect another tenant’s interest is unenforceable, such as an easement from less than all the tenants in common.

testate - Dying with a legally valid will that is probated.

title - (1) A combination of all the elements that constitute the highest legal right to own, possess, use, control, enjoy, and dispose of real estate or an inheritable right or interest therein. (2) The rights of ownership recognized and protected by the law.

title covenants - Covenants ordinarily inserted in conveyances and in transfers of title to real estate for the purpose of giving protection to the purchaser against possible insufficiency of the title received. A group of such covenants known as "common law covenants" includes: (a) covenants against encumbrances; (b) covenant for further assurance (in other words, to do whatever is necessary to rectify title deficiencies); (c) covenant of good right and authority to convey; (d) covenant of quiet enjoyment (see Quiet Enjoyment); (e) covenant of seisin; (f) covenant of warranty. (See Warranty, also see Covenant).

title defects- (1) Any claim or right outstanding in a chain of title which is adverse to the claim of ownership. (2) Any material irregularity in the execution or effect of an instrument in the chain of title.

title plant- (1) In many areas, synonymous with Abstract Plant. (2) A geographically filed assemblage of title information which is to help in expediting title examinations, such as copies of previous attorneys' opinions, abstracts, tax searches, and copies or take-offs of the public records.

title search - A search and perusal of the public records for recorded instruments which affect the title to a particular piece of land. (See also Abstract and Examination.)

trustee – (1) One who is appointed, or required by law, to execute a trust. (2) One who holds title to real property under the terms of the trust.

U

underwriter - An insurance company which issues insurance policies either to the public or to another insurer. Title insurance companies issue title policies directly from an office of the underwriter or through an independent agent.

W

waiver- The voluntary and intentional relinquishment of a known right, claim, or privilege.

warranty - In a broad sense, it is an agreement or undertaking by a seller to be responsible for present or future losses of the purchaser occasioned by deficiency or effect in quality, condition, or quantity of the thing sold. In a stricter sense, it is the provision or provisions in a deed, lease, or other instrument conveying or transferring an estate or interest in real estate under which the seller becomes liable to the purchaser for defects in or encumbrances on the title. (See Title Covenants.)

warranty deed - A deed containing one or more title covenants. (See Title Covenants.)

will - (1) An instrument executed by a competent person, in the manner prescribed by law, whereby he makes disposition of his property to take effect on and after his death. (2) A holographic will is a will entirely written and signed by the testator in his own handwriting. In some states some of the legal requirements regarding the execution of wills do not apply in cases of holographic wills. (3) A nuncupative will is one made orally before witnesses, usually during the testator's last hours of life. Under English law, sailors and soldiers may make nuncupative wills any time during their military service.

writ - A formal legal document issued by a court ordering or prohibiting the performance of some action. There are at least a hundred different kinds of writs each covering a different action or subject. In most writs, an officer of the court, such as a sheriff, is directed to serve the writ or carry out its directions.

writ of execution - A direct command from the court to the sheriff to carry out the action required in the writ. It may be to hang a convicted criminal or to seize property and sell it to pay a money judgment.

Z

zoning ordinances - Laws passed by local governments regulating the size, type, structure, nature and use of buildings. Zoning ordinances, often referred to as zoning laws and zoning regulations, are divided into two classes: (1) those which regulate the dimensions and location of improvements within certain designated zones or districts - in other words, those which relate to structural and architectural design, and (2) those which prescribe the type of buildings which may be constructed, and the use to which buildings within certain designated zones or districts may be put.

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Services offered vary by state. In certain states, including North Carolina and South Carolina, BridgeTrust Title Group and its Affiliates do not offer title search/examination and certain closing services to non-attorney customers and, in those states, such activities are performed only under the supervision of an attorney duly licensed in that state. [Any inquiry for such services will be treated as a request for a referral to an attorney in that state.]